Store lamb and breeding sheep values have held up well so far this season, despite the sharper-than-usual fall in finished prices.
Eblex has predicted that higher lambing rates and a bigger breeding flock should increase the lamb supply for the rest of 2014 and into next year.
UK sheepmeat production is forecast to hit 302,100t in 2014 and 303,600t the year after.
Liveweight lamb prices have continued to ease downwards, with the new season SQQ averaging 162.72p/kg in the week ending 23 August, – 18.84p/kg down on the year.
But across the country, trade in store lambs has held up well so far and breeding ewe prices are slightly improved on 2013.
See also: UK sheepmeat exports hit 16-year high
At North West Auctions’ annual sale of breeding sheep on Saturday (23 August), an entry of 4,317 was met by optimism among buyers.
Auctioneer Matthew Probert said all sheep sold to their full value, with ewes averaging £125 and shearlings £144.
“Sheep have had a better spring and summer on them so they have grown better,” he said.
“The current prime trade probably did just dampen buyers’ enthusiasm a bit for the second quality but they made what they were worth.”
Mr Probert added that store lambs sales had also started well and predicted decent numbers to come through in the next couple of months.
AHDB/Eblex senior analyst Paul Heyhoe said prices at the first store sales had been slightly down on the year but in the first three weeks of August they were roughly on a par with the same time in 2013.
“As there is plenty of grass it is just how confident you are in the finishing price you are going to get,” he said.
Mr Heyhoe said the finished price had a little more potential to slide before the Muslim festival of Eid al Adha on 4 October gives a boost to demand.
Opportunities in Russia
Russia’s ban on western food imports could offer opportunities for British sheep farmers, according to trade and investment company Volga Trader.
Lamb is not on the banned list and the UK has had access to the Russian market for beef and lamb since September 2013.
“There is now a big opportunity for sheepmeat to replace the lost pork imports,” said Volga Trader sales director Philip Owen.
But AHDB/Eblex senior analyst Paul Heyhoe said it would be a “big leap” for the UK to fill the gap, as few processors were set up to send meat there.
“It is more likely for the existing suppliers, New Zealand and Australia. We struggle to compete with them price-wise.”